Startup marketing can be a challenging journey, especially if you are starting from scratch. With so many digital channels to invest in and thousands of experts offering you multiple strategies, it is hard to make an informed decision.

The difference between startups and established businesses is the fact that the former is highly concerned with customer acquisition and retention more than anything else.

An established business might have the budget to burn cash for awareness and branding, whereas a startup’s major concern is more likely paying customers that can be generated without that cash burn.

A lot of entrepreneurs get too excited or maybe they just don’t have clarity of direction yet. On the other hand business owners that do have an overall plan and get all of their strategies pulling the same way, are thriving.

I couldn’t agree more with the above statement.

Sean Ellis, the first marketer at Dropbox coined the term growth hacking, with an entire science behind it focused towards technical startup marketing.

This post talks about how popular startups understood the startup marketing funnel and applied successful hacks at every level to reach where they are today.

Understanding the startup marketing funnel

The marketing funnel for startups is based on the AARRR model. Here is what it stands for:

In order to get more traction for their listings, Airbnb decided to give an option to their site visitors for sharing their listing on Craigslist as well.

With a smooth marketing message, they encouraged people to share listings on Craigslist as well.

The results?

Using this hack, Airbnb received the attention of thousands of users from Craigslist, and since their listings were much more attractive with better descriptions and photographs than Craigslist, this led to a viral growth cycle.

2. Activation: How PayPal activated users

Paypal was one of the most successful startups of the late 90’s.

Their phenomenal growth story involves going from 1 million users in March 2000 to 5 million users in summer 2000.

They started activating users by paying them to sign up. With every sign up, Paypal paid you $ 20 to sign up (and also $ 20 for a referral). As the value of their network grew, they reduced the bonus to $ 10, $ 5 and eventually nothing.

This was a classic example of activating users by giving an incentive.

Paypal tried a lot of advertising but this method achieved them the lowest CAC.